Memeorandum

May 31, 2009

Has Anyone Mentioned The Recession To Michelle?

President Barack Obama and Michelle Obama landed in New York Sunday
afternoon, and after taking a helicopter from JFK into Manhattan, drove
up the West Side Highway, where the northbound lanes were shut down by
police for their visit, past Ground Zero, into the Village for dinner
at the Village's Blue Hill restaurant. From there, they went north to
Times Square, where they went to to see a production of "Joe Turner's
Come and Gone" at the Belasco Theater on West 44 Street.

Deputy Press Secretary Josh Earnest read a statement from Obama: "I am
taking my wife to New York City because I promised her during the
campaign that I would take her to a Broadway show after it was all
finished."

Obama also promised a middle class tax cut and healthcare reform, but obviously those can wait. However, the new frugality really is for everyone - we need to drive smaller cars and Obama led the way:

The president traveled in a smaller, Gulfstream-type plane rather than
the larger planes typically used as Air Force One. Two other planes
carried staff and reporters.

Leadership!

Normally an event like this would be dressed up as a fundraiser so the national committee could pick up the tab. I don't have the impression that Michelle would spend her own money on this, so I can't wait to learn how much the taxpayer shelled out for the night out.

This Lifestyles of the Rich and Famous date night was arrogant, it was tone deaf, but it's OK because they're not Republicans.

Let's hope that the Chinese officials worried about their US Treasury holdings don't take the same tone with Obama that Congress took with the Detroit executives.

IT'S ONLY WORDS: Glenn Reynolds ends the Best Title competition with "BLAMING IT ALL on the nights on Broadway". This is a special dagger to my heart since "Nights on Broadway" is one of my all-time fave open road sing-along songs. In fact, my kids often join in with a bit of encouragement along the lines of "Hey, it's that stalker song - let's see if Dad gets "standing in the dark" and "standing in the light" reversed like he always does." Yeah, wait 'til their Alzheimer's kicks in.

If there is a God in Disco Heaven this will all come together on Monday when reporters grill Obama press flack Robert Gibbs about "Nights on Broadway" to the soundtrack of "You Should Be Dancing" and "Jive Talking".

President Barack Obama said he made clear to bank CEOs who visited him
Friday that they need to get rid of lavish bonuses and perks that have
angered the American people.

"Show some restraint," Obama said he told the executives, according to
an interview he taped Friday with Bob Schieffer of CBS News. "Show that
you get that this is a crisis and everybody has to make sacrifices."

Finally, the Obama administration and Democrats in general need to
do everything they can to build an F.D.R.-like bond with the public.
Never mind Mr. Obama’s current high standing in the polls based on
public hopes that he’ll succeed. He needs a solid base of support that
will remain even when things aren’t going well.

And I have to
say that Democrats are off to a bad start on that front. The attempted
coronation of Caroline Kennedy as senator plays right into 40 years of
conservative propaganda denouncing “liberal elites.” And surely I
wasn’t the only person who winced at reports about the luxurious beach
house the Obamas have rented, not because there’s anything wrong with
the first family-elect having a nice vacation, but because symbolism
matters, and these weren’t the images we should be seeing when millions
of Americans are terrified about their finances.

"TODAY" SHOW CHYRONS "BROADWAY BACKLASH" inside the GM package — NBC's
Savannah Guthrie: "Some are criticizing the president for the timing of
a weekend trip to New York. The Obamas took a smaller Air Force One to
the city for a date night. Press and staff followed in two smaller
planes. ... In a statement, the White House responded [to RNC
criticism]: 'The president would have been happy to take the shuttle to
New York City if they'd been permitted to do so.'"

The White House tells us it was a secret service call.

Hmm, the Secret Service refused to let Obama cancel the trip in order to preserve appearances? We underestimate their vast power.

If I remember right, GWB gave up on golfing after US forces got bogged in Iraq. The reason? “I, as a commander-in-chief, do not like to pose golfing while members of US military loosing their lives and limbs in Iraq”.

I agree with glasater: Dunham and Worf look pretty hammered in that photo. I realize pictures can be misleading but that's not the Jack and Jackie (which I realize was a BS sham on a different level but at least they had the savoir faire to appear to be enjoying themselves at all times when they were together) of a new generation. NYC being smoke-free is something Barry probably didn't plan on. Plus his suit doesn't look like it fits. Classy.

No, not even close to John and Jackie, or Franklyn & Eleanor, who they hope to emulate. First of all, Franklyn even when
he was running for Vice President, would ever be that tone deaf. I have to chip in with a LUN, of someone who looks down to earth, but with a touch of class, even when
they are trying to insinuate something untoward about her. Gave it away, didn't I.

Tops:I do NOT care if they want to fly to Hong Kong for a date so long as they do not dictate what car I drive or the temperature I keep my thermostat at or tell me what days I can burn a fire in my fireplace and then have the gull to tell me to "sacrifice"

Exactly.

Most Americans, she said, don't want much.

"They don't want the whole pie," she told the women. "There are some who do, but most Americans feel blessed just being able to thrive a little bit. But that is becoming even more out of reach."...

"The truth is, in order to get things like universal health care and a revamped education systemNYC date nights for me and Barry on the taxpayers' dime, then someoneeveryone is going to have to give up a piece of their pie so that someone elseI can have more."

The trip Obama made in and of itself isn't wrong. The trips Bush made weren't wrong.

The point at which I am shown that Bush told us we were out of money and had to tighten our belts and where he attacked businesses for spending money and said that the world was ending because of carbon emissions ... before going on a personal trip is the point at which I see the similarities and am willing to excoriate Bush and cut Obama slack.

I don't mind that Obama went on a date. I don't really even mind that doing so is expensive. I don't mind that he wanted personal time with Michelle. I don't think the nation was harmed that he had dinner at a nice restaurant and caught a show, using three planes to get there and back.

I do mind that he is doing the exact thing he condemns others for doing. I do mind that he sees himself as being above any of the criticisms he levels at others. I do mind that he views himself as above and apart from the rules he would impose on the rest of us, including the rubes who still love him.

...it’s important for this administration to send a message that there aren’t two sets of rules,” Mr. Obama said in an interview with NBC News. “You know, one for prominent people and one for ordinary folks who have to pay their taxes.”

I've lost the over and under on whether this crew is merely stupid or evil

Nothing like putting us deeper in the tank to OPEC. Where are the Repubs on this? This is a tailor made opportunity to put the Donks on the defensive and we have Rodney King Steele singing ****ing kumbaya.

Considering they shut down offshore drilling, closed off a number of oil shale projects, have pretty well spiked nuclear, closed off ANWR, are implementing cap & trade, and now this, I think it pretty obvious.

As we are in photovoltaic technologies, this is just plain nuts on Ogabe's part. The infrastructure can only handle @ 15% renewable energy because of various issues with fluctuations, and the cost is exorbitant. The only way it works is with massive subsidies.

So yeah, I think it is willful and part of a secret plan they never discussed with anyone beforehand. It seems to be a hallmark of this administration. Accountability, transparency, and it's all Bush's fault. Change you can disbelieve in.

Is it more rain than last year, Po? Seems I heard more about rain and flooding last year. And even when we made our cross country trip at the end of June, the Missouri was completely out of its banks up near the Missouri/Iowa/Nebraska border.

Honestly? I haven't been keeping track of amounts. However, it's constant,and it's kept us out of the fields longer. The amounts, I don't think, are as great, but the soil was already saturated and we just keep getting soaking rains every few days. Last year, we planted all our corn the second week of April, then wound up planting all our beans the 3rd week of June. This year, we have had a few days in between we could work, but we wound up replanting most of our corn, and the Soybeans that have been planted aren't a sure thing. I hate replanting.

The star is named Betelgeuse. It's in Orion, and is one of the brightest stars in the sky. As a young man I actually took navigational sightings on Betelgeuse with a sextant, back in the days not just before GPS, but even before Loran. There were no satellites at all up there then.

No idea what moved the movie-maker (I think it was Tim Burton) to come up with "Beetlejuice."

"Even with the expectation that consumers will be cautious, economists predict that the economy as a whole is not sinking nearly as much now as it was in the prior six months."

"With seven pints on the floor, bleeding has slowed significantly, respiration is down to 8, making it much easier for the doctors to hear the faint heart beat and the EEG is much easier to read now that all those bumps have disappeared."

I liked this one too: "The expected improvement would come from less drastic cutbacks in spending by businesses."

With both legs and an arm gone, fewer cutbacks are a certainty.

The Credentialed Moron Consensus of a -1.8 contraction in GDP for Q2 is charmingly optimistic. It fits nicely alongside APs pimping of the silver lining surrounding the passing tornado.

BTW - the increase in saving to an annual rate of $620 billion marks a 23% increase in the saving rate over Q1. It sorta makes the babble about "increased consumer confidence" look like... what's the word? "damned lie" works but doesn't fit the "green shoots' meme. Oh well.

Is the term "green shoots" a relatively new development or has it been around for a while? Is its origin from this administration trying to spin bad news into good by alleging small signs of economic good news?

Funny how the last two donk preznits had *problematic* father figures and skeezer mothers who didn't instill any type of respect for women; then ended up marrying humorless harridans that the MSM incessantly describes as "brilliant" or "gorgeous". Although unlike Slick, Bammers didn't end up a hound/predator; although the MSM would probably be remarkably uncurious about that as well.

Rick, I think we need to be ready for the eventuality that the economy "recovers" in the cyclical sense, even as its long-term prognosis is dire. There are cycles and trends, and the economy can cycle back up despite the damage inflicted on it, even as the trend is killed. To take your medical analogy, Dr. Obama has not managed to kill the patient, the patient's own immune system may bring about a recovery, but the long-term damage from Dr. Obama's treatment will still be there.

Dr. Obama will take credit for the "recovery" nonetheless, and we need to be ready to point out what a crappy recovery it will be. Yes the stock market is up almost 40% from the trough, but it is still down 40% from its peak. The unemployment rate may well go back down to 6%, but our standard of living will be permanently lower thanks to Dr. Obama's malpractice. That's the point we and the GOP need to be emphasizing.

"Is the term "green shoots" a relatively new development or has it been around for a while?"

It has been used here for a couple of years or so to explain the verdant bits on a corpse.
"The first green shoots of recovery".
Same stable as "Dew Fresh Morning Picked Free Range Baby Mushrooms".Produced the same way in the dark and fed on manure.

Porch, as I think I mentioned here before, I grew to respect Muffer for the way she conducted her campaign after the press redirected their infatuation from her to Obinski. Particularly because she's not a particularly gifted campaigner and her oafish husband was no help to her; the best that can be said of Slick was that he didn't trigger a Meghan's Law alert.

Dr. Obama will take credit for the "recovery" nonetheless, and we need to be ready to point out what a crappy recovery it will be. Yes the stock market is up almost 40% from the trough, but it is still down 40% from its peak. The unemployment rate may well go back down to 6%, but our standard of living will be permanently lower thanks to Dr. Obama's malpractice. That's the point we and the GOP need to be emphasizing.

Agreed. There will be a turn in housing, simply because shelter is a need and new families are still seeking Escape from Blue Hell. We're also going to be treated to "new" statistics, the BEA and the BLS are in the process of revamping their statistical methodology in order to provide Dr. Ogabe with "scientific proof" that the patient is simply pining for the fjords and will be leaping to his feet momentarily. IMO, the Credentialed Moron Consensus is two quarters off. I can see the beginning of the upturn in your reverse J starting in Q2 '10 but not much before. The increased savings rate just isn't being adequately addressed in the Credentialed Moron economic modeling programs as yet. Neither is the adjustment on the debt serf choke collars.

OT - Justice Department political appointees overruled career lawyers and ended a civil complaint accusing three members of the New Black Panther Party for Voting Rights violations.

Justice Department political appointees overruled career lawyers and ended a civil complaint accusing three members of the New Black Panther Party for Self-Defense of wielding a nightstick and intimidating voters at a Philadelphia polling place last Election Day, according to documents and interviews.

The incident - which gained national attention when it was captured on videotape and distributed on YouTube - had prompted the government to sue the men, saying they violated the 1965 Voting Rights Act by scaring would-be voters with the weapon, racial slurs and military-style uniforms.

Career lawyers pursued the case for months, including obtaining an affidavit from a prominent 1960s civil rights activist who witnessed the confrontation and described it as "the most blatant form of voter intimidation" that he had seen, even during the voting rights crisis in Mississippi a half-century ago.

Somebody at AoS reported last week that there have been huge blocks of trades of unknown origin that have been propping this "recovery" up. It all sounded rather sinister but the person doing the reporting sounded like he/she knew what they were talking about.

Dittoes to jimmyk's 11:05.
And along those lines I suspect GM and Chrysler may actually have a better chance of success than they are being given.
GM's product line is actually very good. If their costs are now competitive, which is a big if, then it is possible they can pull off a turnaround, IMO.
Marchionne at FIAT is pretty sharp as well and I would not underestimate him. If he can meld his lineup with Chrysler's underrfunded mess of cars he could pull it off too.
I believe for the foreseeable future both will have the implicit guarantee of the Feds behind them, even if they're profitable, which many people will actually consider a plus, security wise. I doubt Barry is going to let anyone, Ford especially, have a level playing field while his name is on either brand, which means the rest of his presidency.

The biggest question to me is how CAFE, cap and trade and his alternative energy subsidy/high oil and coal price policy will play out. There's enormous risk for his two automotive protege's as well as enormous opportunity for Chicago style finagling on their behalf by the Feds in all of his retarded regulation schemes.

I believe for the foreseeable future both will have the implicit guarantee of the Feds behind them...

Not unlike Fannie and Freddie, and when it all went bad, the implicit became the explicit. I was surprised that Fiat didn't end up with GM European operations, but Magna is a major parts supplier for Chrysler and GM in any event. They also seem to be big on hybrid technology and the deal was closed with a Russian bank (humm nickle for the battery system?). Fiat can loot Chrysler for the truck lines and minivans and build plants in Thailand and Brazil while having a standing buy-out offer to Chysler UAW employees.

When I started reading this article I thought Mr. Ballard might be moonlighting as The Mogambo Guru.

And then I realized the writer could not be RB--for Mogambo is a bit more pessimistic. From the article:

On the other hand, from another perspective, John Williams at shadowstats.com figures things the "old-fashioned" way, which is to say, in this case, the pre-Bill Clinton way, and he figures that the M3 money supply is - sacrebleu! - falling, and is now down from its high of about 17% growth in 2008 to only about 7% now, which is still "terrifying", but down from "suicidal."

Then I read that Mr Williams figures that the unemployment rate, measured the old-fashioned way, is about 20%!

Dr. Obama will take credit for the "recovery" nonetheless, and we need to be ready to point out what a crappy recovery it will be. Yes the stock market is up almost 40% from the trough, but it is still down 40% from its peak. The unemployment rate may well go back down to 6%, but our standard of living will be permanently lower thanks to Dr. Obama's malpractice. That's the point we and the GOP need to be emphasizing.

One way to do this is to not fall for the Green Shoots mentality of the MSM in describing a "gain" of 40%. Chairman Zero knocked the economy off a cliff when he was elected because business owners the world over recognized the disaster coming. The market fell to 45% of its high during the Bush years. It is now at maybe 62% of that high, a net "recovery" of maybe 17 percentage points (not 40%) as we try to stand up on this narrow ledge before Soros shoves us off of that to the bottom of the cliff.

I think they tried putting her out there in a more political way earlier on, but it probably didn't poll well. Hence the WH perfect mom/wife/fashion maven/organic gardener routine we're seeing now. Let's face it, Michelle's mother takes care of the kids most of the time and has done for a long while now. It would be more appropriate to shower praise on her, imho.

One way to do this is to not fall for the Green Shoots mentality of the MSM in describing a "gain" of 40%.

Agreed, Bill in AZ. The 40% number is accurate but misleading. I didn't figure it was necessary in this crowd to package it the way you did, but a lot of people don't realize that a 40% gain after a 50% decline only represents 20% of the way back.

jimmyk, I know you and everyone here understands that, but if the rest of the world gets called on it Every. Single. Time. it becomes habit to reflect the world in reality. I call it the "Gratuitous Talking Point" any time some MSM talking head slips something like that in and doesn't get challenged on it.

Sort of. I can see moving to Australian equities (and ag and resources generally) but I'm not up to speed on what Schiff has been talking about recently.

The market has the feel that it is in the hands of the technicians and chartists and until some news, which pierces the Obama "green shoots" bubble drops, they'll be in charge running the markets up and down getting everything back into "historical ranges". FWIW.

Why would fleeing from the US dollar to go into a US domiciled and denominated asset class actually protect an investor if the investor were worried about the value of the US dollar?

There's another answer: inflation. In principle, stocks, like real estate, are immune from inflation in the long-run, whereas bonds and the dollar are not. Of course inflation usually is not good for stocks in the near term either. But there's no reason a flight from the dollar has to kill all dollar denominated assets.

"The Obama Administration has been whispering to the press that it could start selling its stake within a year to 18 months, and that it hopes to be out of the business entirely in five years. But even assuming that the taxpayer investment stops at $50 billion, GM would have to be worth a cool $80 billion for taxpayers to break even on their 60% stake. By way of comparison, GM's market capitalization at its recent peak in 2000 was only $56 billion."

--Ignatz...I love you Bro...but how anyone can expect anything good from an auto company controlled by politicians and unions is beyond me.--

OL,

Love you too bro, but my post was in response to the oft repeated claim that GM and Chrysler are headed directly to oblivion from here.
I doubt that. I think one of two things will happen.
Either the UAW and team Barry will have the sense to let them make cars on their own in relatively good financial health and reap the rewards of that, all the while giving them the implicit guarantee Rich spoke of above.
Or the UAW and team Barry are going to keep them limping along directly on the government dole if they stupidly choose to run them themselves.
Nothing good will come of the latter and the former will be far less than good if that implicit guarantee is not eventually eliminated. The first will be an open spectacular disaster but the second will be a stealthy market distorting one.

But in neither case will they simply dry up and disappear.
Even United Airlines still exists even though the employee owners flew it into the ground after they took over.

I agree with you there, Ignatz, though I suspect you wasted perfectly good ink on Option A!

Had you already seen the WSJ editorial, a paragraph of which I just posted?

The Govmo "deal" clearly looks (financially) bad for taxpayer-investors under either of your options, though of course governments always ignore things like that. I suppose the Progs would say if jobs are protected and a captive manufacturer can produce windup cars, then it's worth the price paid...

On the other hand, if the union owns two of the companies and also the political levers, when they turn the screws on Ford and then the foreign companies, several more of the actions that turned 1929 into a global depression will be in place.

((but I'm not up to speed on what Schiff has been talking about recently.))

He posts a video daily, they are interesting. He is preaching the same gospel he always did. I can't stand Lew Rockwell but I go to the LR blog to hear Schiff's videos that are posted there. On Friday Schiff said he'd just had his best week evah. I'm still not a hundred per cent with him tho.

((The market has the feel that it is in the hands of the technicians and chartists and until some news, which pierces the Obama "green shoots" bubble drops, they'll be in charge running the markets up and down getting everything back into "historical ranges". FWIW.))

I don't think the market is being driven by 'green shoots' I have only been following the stock market for about one year and it seems to me that things are following the exact same pattern as they did last year, oil going up at this point in time and so forth ... which implies to me that the coming months are gunna bring another severe downturn. That is strictly my personal opinion FWIW

And I think the Chrysler Fiat deal is suspect. Fiat has been doing big business buying essentially second tier brands and gutting them. Quality control at CaseIH appears to be in the shitter, for one. Too many too cheap electrical parts on a 200k tractor = pissed of customers. I expect the same fore Chrysler.

You guys may not have been following commodities lately. Find a site like barcharts and dig around. Soybeans are taking off, wheat, lumber, as well as oil, all of them in the face of things which are technically bearish. The whole setup stinks.

Then you have to explain why stocks stayed dead flat for the fifteen years of our last hyper inflation from the late sixties until the early eighties.

My two-word answer is Jimmy Carter. That plus OPEC. Which is only to say that there are lots of things that can adversely affect the stock market. Of course, Obama is much worse than Carter, but that doesn't mean the Dow can't get up to something like 80% of its previous peak.

If their costs are now competitive, which is a big if, then it is possible they can pull off a turnaround, IMO.

It seems to me that both "bailouts" are about nothing else besides making sure that their costs cannot be made competitive.

(And can somebody tell me when the unions went wacko? Used to be that the union workers at Deere and Cat understood that bad for farmers meant bad for them. The UAW understood that their prosperity depended on being able to sell those cars. I wonder if it's the rise of government-employee unions -- those people get paid no matter how destructive they are. I keep thinking that this just goes to prove that the mafia isn't in charge any more -- they'd be a lot smarter than this!)

There was a huge amount of short-covering last week. That's part of the rise. I think a lot of the rest of it has to do with chartists and computer programs that can't understand what Zero and Turbo are doing because those inputs don't translate into programs well.

The other thing is that gold is nearing $1,000 an ounce. There is no fundamental demand for gold at that level or anything close to it. Some investors may be parking cash in the stock market while waiting for gold to cool off.

Though that won't happen because the dollar is heading towards ruble territory.

Buy bleach; you can use it purify water. You already know about the firearms and ammo.

funny you should say that ... I have actually thought on more than once how evocative your moniker is, for me it conjures up lovely Thomas Kinkade-like visions ...

((I think they tried putting her out there in a more political way earlier on, but it probably didn't poll well. Hence the WH perfect mom/wife/fashion maven/organic gardener routine we're seeing now. ))

you could be right ...

whatever the reason I don't think her new job is fulfilling her expectations

cathyf, it may the world's worst case of biting off your nose to spite your face. O's latest CAFE regs show that he isn't serious about getting the Big 1.2 off the dole. Ford will be in Ch 11 pretty soon, so I'm glad they spun off several companies, which I sold, netting twice my original investment in Ford.

Daddy beat me to it, but It looks like there's at least one thing that has survived longer on your side of the pond than ours! Per Gateway Pundit, the Daily Mail actually shows some interest in following the money.

Daddy:

Of course, there are known unknowns yet to be considered. We don't know if Michelle bought a new dress for the evening, for example, and if she did, who paid for it. Couldn't Shouldn't be much of an add-on though. OTOH, you'd be astonished at what a little turquoise clutch can cost.

Given the "investment" of tax payer money in this public-private "venture" I'd have thought our President could, at a minimum, have offered Mayor Bloomberg a handshake on the tarmac, as he did Nevada's governor. So much for multi-tasking! If, however, you factor in the $100 million savings provided by a thoughtful Cabinet, Obama has only got to spend $930K more to bring things back into balance. The multiplier on an intimate public White House date has got to be respectable, if modest -- and more shame on us for not recognizing the symbolism in this down payment on family values.

Last but not least for the lingering Fashionistas among us:

There's no way to top the photo Ann posted last night, but the Daily Mail's PG-rated S-curve shot of Michelle boarding So-Hard-to-be-Humble-One confirms my concern that FLOTUS is struggling with a hairstyle deficit along with everything else. On the bright side, however, she did nix the argyle in favor of basic black -- unless, of course, this is just the black-on-black version.

Just did a run through of the Home Pages for FOX, CNN, ABC, and MSNBE. Not a single one mentioned the $73,000 taxpayer price-tag. In fact, excepting CNN, none of them mentioned the NY City date business at all. Already down the memory hole. Surprisingly Jack Cafferty of CNN mentioned it, but neglected to discuss the cost, and essentially wrote it as something that made New Yorker's happy, Republican curmudgeons grouchy, and laid the blame for the cost, whatever it was, at the foot of The Secret Service.

Time to update Shakespeare: "First thing we do, we hang all the News Media---then we hang the Lawyers."